MM thoughts on JB HI FI
Why has the share price dropped from $53 to 45? Is it still worth holding or take this opportunity to add at current price. Thanks. Shernavaz.
The Latest Q&A
Answer
Hi Sernavaz,
2 reasons, the first being Kogan’s inventory problems (too much stock) implies that they’ll start discounting heavily, things like electronics and that will have a negative impact on JBH sales. The second is their hugely successful CEO Ricard Murray announced he’s leaving and going to Premier Investments (PMV). We also saw a couple of broker downgrades just to add fuel to the fire.
More broadly, the whole Retail Sector has endured a fairly tough week with 4 major players falling over 5%. We’re not considering JBH at present as we feel significant good news around an economic recovery is already built into prices. Nearer ~$40 would have us interested.
